Friday, April 12, 2024

Why I’m no longer selling my wool at auction

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The farmer is left to carry the loss alone while shearers, exporters and manufacturers make the money, writes Toby Williams.
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By Toby Williams

I recently wrote a piece for Farmers Weekly titled ‘Can the last shearer out please turn off the lights?’ where I spoke about the crisis our wool producers are currently farming through. 

I called for bold leadership and innovative new solutions, and concluded with an open-ended question for our sheep farmers to ponder: 

Are we content to sit back and watch the future of wool slowly fade to black, or are we going to stand up and fight for its survival?

Since that story went to print, I’ve had an overwhelming response from our rural community, with farming families from across the country reaching out in support. 

Like me, they’re sick and tired of sending their wool clip to auction only for it to sell at a price that doesn’t even cover the cost of shearing.

Their businesses just aren’t making enough money to provide for their families. Their budgets are splattered with red ink. 

Those families aren’t alone in their predicament.   

As Federated Farmers meat and wool chair, I attend my fair share of farmer meetings across the country, and everywhere I go, the room is full of people asking the same hard questions about the future of wool in New Zealand. 

Some are saying there’s no money left in wool, but I disagree. There’s still plenty of money left in wool – the problem is that farmers aren’t seeing any of it.

Everyone else in the wool value chain seems to be making a dollar – the shearer, the exporter, the manufacturer – but the farmer is left to carry the loss alone. 

We have to ask ourselves: what other business would continue to sell their product at a loss year after year, like we have with wool? 

Most businesses could probably stomach a year or two in a crisis, but it’s just not sustainable in the long run, particularly for small, family-owned businesses. 

Eventually, you need to return to profitability and recover your losses. So, why do we as farmers continue to do it? 

The problem is that 90% of our wool is sold on the international market as a low-value raw material, where we’re competing with cheaper synthetic fibres made from fossil fuels.

Our high-quality product is labelled as ‘general strong wool’ and sold in an auction system at high volumes, which erodes its value. 

To add salt to the wound, our New Zealand wool is often blended with inferior wool from around the world to lift the overall quality for manufacturing.

If you ask me, this shows very little respect for our product. 

It’s like mixing Jack Daniels into your single malt Scotch, topping up a glass of Dom Pérignon champagne with Lindauer, or throwing some Sizzlers on the BBQ next to your prime home-kill sausages. 

Unfortunately, there’s very little we can do as farmers about the auction system, or what happens to our wool once it’s sold, but there are some things we can control, like what we do with our own wool clip.

That’s why my family and I have told our broker we are no longer willing to sell our wool at auction. Instead, we are going to try to sell privately for a fair price. 

Some of you will think I’m mad, and maybe I am, but if enough farmers decide to stand together and join me, I think we can make a real difference.

If you do a great job of preparing your wool for sale, with a full team of rousies, and all oddments and poorer styles taken out of your main line, then you know you have the wool that buyers want most. 

Let’s send a clear signal: if they want our wool, they’re going to have to come to us with a fair price that doesn’t send us broke, or continue to buy poorly presented and prepared clip from those who have given up.

Yes, a move like this comes with risk. Each farming family will have to make their own decisions, but the way I see it is that we need to try something. 

I won’t be selling my wool at auction this winter. Are you with me?

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